Albion STILL losing money

[Acker79]

Average is 17 million so therefore at 13th or 14th we are going to be below that, or is that a bit simplistic?

13th or 14th out of 24 teams. So almost exactly half way, so if we are under it, not by much, 15m or 16m are both below 17m and both in the range of 15-20m.

 

[Thunder Bolt]

huh?

If the average of 24 teams is 17m, surely somewhere in the middle (i.e. 13th or 14th) would be close to the average, (i.e. 15-20m)?

The middle is 12th so ours would be less than 17 million?

 

[Herr Tubthumper]

Average is 17 million so therefore at 13th or 14th we are going to be below that, or is that a bit simplistic?

Yes. The distribution of these data is key when considering the rank (ie what Gus stated) and the average (presuming arithmetic mean). And we don't know how these data is distributed.

 

[Weststander]

Norwich were good payers by Championship standards, Reading too as a combination of parachute payments and Majedski millions allowed them to keep a decent squad. Blackpool did well, but scraped through via the playoffs I think.

On average once every two/three years a club who is not paying out top dollar wages comes through, last year West Ham and Stains both paid out big money (Nolan on £50k a week, Jack Cork £23k a week etc), Reading were able to give Jason Roberts a deal signing him from a Premiership club, so whilst there is a lot of speculation involved, the relationship between money paid out on wages and success is a positive one.

Exactly.
The positive correlation between club wages and league table position is proven, with the odd exceptions such as Holloway teams.

(Far more than transfer fees, with free transfers inwards distorting that. Wages reflecting quality of player).

http://www.sportingintelligence.com/2012/05/14/its-the-economy-stupid-how-wages-aid-success-in-the-premier-league-140502/

Even the common view that Wenger works miracles on little money is exposed as a myth, with their wages now at £143.3m (only £17m behind ManU), which is the 4th highest, and surprise surprise, they finished in the Top 4.

 

[Weststander]

Any idea what the promotion bonuses are? If you subtract these out then we will have an accurate cost of getting to the Prem.

Norwich's was £4.4m and Blackpool's £5m, within those payroll costs.

 

[Acker79]

The middle is 12th so ours would be less than 17 million?

Maybe, but as I said 15m, 16m are both below 17m, and both still in that 15-20m range. So, it can be below average and still in the range you say it can't be in if less than 17m.

So the logic of that argument is flawed.

There is also the maths behind averages, that make it flawed, because there's the possibility that the bottom few teams really pull the average down.


24
23.5m
23m
22m
21.5m
20.5m
20m
11m
4m
0.5m

The average of those 10 wages is 17. The fifth highest wage is 21.5m. The next highest is also 20.5m. Then 20m. Two of them below the half way point of the list are comfortably above the average for them.

Here are 3 other ranges, each with an average of 17 (I've highlighted teams lower than 12th that are higher than 15m and thus in the 15-20m range that you say is impossible if you're lower than 17m):

 

[Springal]

Should we be making money by now? Surely our first year operating costs would be a lot to setup, the increase in staff etc, but should settle year 2 onwards?

Also did we not know this, as was the reason Ken Brown went.

 

[Blue Valkyrie]

You conveniently forget the relegated clubs from the top flight and their parachute payments (is it £40m, £20m, £20m) That is a massive chunk and we would need to sell 1,333,333 match-day tickets for the first season and then 666,666 for the other 2 at an average of £30 a ticket to match that income.

making a few assumptions here for us this season, if you say we get on average 25k at £30 for the average ticket price times 23 games = 17,250,000 which is still less that the parachute payments for the ex-top flight teams and we would need to shift a further 758,333 tickets a season or 32,971 tickets a game to match this income for the first season or an extra 91,666 tickets a season or 3985 a game for the other 2 seasons, and that's before you take into account the clubs that receive the parachute payments own match-day ticket sales.

Currently it's over 4 years and set at 16million, 16m, 8m, 8m

16 million is the equivalent of around an extra 30,000 £23 ticket sales per match. Except of course there is no matchday pie/beer/merchandise sales from this, so the real equivalent is a little lower. A massive advantage though.

It is a real worry that a cash generating machine like the AMEX is not delivering a break even cash balance. However, the club are not idiots, I expect there is quite a potential for cost cutting, and certainly a massive opportunity to increase sponsorship and comercial partnership revenues. All jobs for Barber, and apparantly he's quite good at it.

 

[Blue Valkyrie]

Should we be making money by now? Surely our first year operating costs would be a lot to setup, the increase in staff etc, but should settle year 2 onwards?

Also did we not know this, as was the reason Ken Brown went.

I always thought Brown must have gone because of the fiasco with travel vouchers, and resulting losses. Bit of a guess, although it probably was to do with club finances.

 

[Guy Fawkes]

Maybe, but as I said 15m, 16m are both below 17m, and both still in that 15-20m range. So, it can be below average and still in the range you say it can't be in if less than 17m.

So the logic of that argument is flawed.

There is also the maths behind averages, that make it flawed, because there's the possibility that the bottom few teams really pull the average down.


24
23.5m
23m
22m
21.5m
20.5m
20m
11m
4m
0.5m

The average of those 10 wages is 17. The fifth highest wage is 21.5m. The next highest is also 20.5m. Then 20m. Two of them below the half way point of the list are comfortably above the average for them.

Here are 3 other ranges, each with an average of 17 (I've highlighted teams lower than 12th that are higher than 15m and thus in the 15-20m range that you say is impossible if you're lower than 17m):

View attachment 37587

But arn't the teams that were relegated from the top flight likely to still have very high earners on their books and therefore distort the figures the other way meaning that the mid range spenders are likely to be well below the 17m average.

The problem is we don't know what the other teams are spending to be able to arrive at a figure.

Using your simplistic 10 team explanation, you could also have the following
38
33.5m
27m
21m
10.5m
9.5m
9.0m
7.5m
7.0m
7.0m

meaning that the 6th team only spends 9.5m but the average is still 17m

 

[Guy Fawkes]

Currently it's over 4 years and set at 16million, 16m, 8m, 8m

16 million is the equivalent of around an extra 30,000 £23 ticket sales per match. Except of course there is no matchday pie/beer/merchandise sales from this, so the real equivalent is a little lower. A massive advantage though.

It is a real worry that a cash generating machine like the AMEX is not delivering a break even cash balance. However, the club are not idiots, I expect there is quite a potential for cost cutting, and certainly a massive opportunity to increase sponsorship and comercial partnership revenues. All jobs for Barber, and apparantly he's quite good at it.

When it came to catering, did we get a cut from the profits or did we just receive a flat income per season. If it was a flat income then it would have made no difference to the clubs finances if we sold 10 times more than expected as all the extra income and therefore profit would have gone to the caterers.

Maybe they realised they massively undersold this and that's part of the reason Azure were sacked. I expect we have had to pay them off to which could also go some way to explaining some of the loses.

 

[Blue Valkyrie]

When it came to catering, did we get a cut from the profits or did we just receive a flat income per season. If it was a flat income then it would have made no difference to the clubs finances if we sold 10 times more than expected as all the extra income and therefore profit would have gone to the caterers.

Maybe they realised they massively undersold this and that's part of the reason Azure were sacked. I expect we have had to pay them off to which could also go some way to explaining some of the loses.

We got a cut of profits over a certain amount + 18 million over the contract duration.

I'm sure we did want to renegotiate the terms given that sales were way over expected. Azure obviously didn't want to do the deal we wanted, and so we waved them goodbye.

 

[Acker79]

But arn't the teams that were relegated from the top flight likely to still have very high earners on their books and therefore distort the figures the other way meaning that the mid range spenders are likely to be well below the 17m average.

The problem is we don't know what the other teams are spending to be able to arrive at a figure.

Using your simplistic 10 team explanation, you could also have the following
38
33.5m
27m
21m
10.5m
9.5m
9.0m
7.5m
7.0m
7.0m

meaning that the 6th team only spends 9.5m but the average is still 17m

Yep. That's all absolutely true. Though I imagine the promoted teams will be significantly lower, as well, thus balancing out the top range. In reality it's probably a third of teams on a lot more than 17m, a third around the 16-18m range, and a third significantly below 17m, or some similar structure of such a spread (a quarter high, a quarter low, half in the middle, etc).

I was just trying to explain why "we're 13th or 14th in the budget table, the average is 17m, ergo we can't be in the 15-20m range" comment was flawed.